Nigeria's unhappy new year : "Fuel Subsidy Removal"

In our series of viewpoints from African journalists, writer Sola Odunfa considers why Nigeria's poor especially feel so angry and exploited by the government's removal of a fuel subsidy.

An economic and political theory is playing out in Nigeria over the entrenched corruption in the country's petroleum sector as workers begin a nationwide indefinite general strike against the government's total deregulation of the pump price of petrol.

Labour and civil organisations say they will shut down all public services, including air and sea ports, to demonstrate popular opposition and anger at the new policy which has more than doubled the price of fuel - a policy they say is insensitive to the impoverished state of most Nigerians.

Hardly anyone faults the government's argument that the national treasury cannot afford the estimated $8bn (£5bn) being paid each year to faceless importers to subside the pump price of petrol, but everyone counters that the government should first find out how legitimate is the amount being paid.

The government's position today seems to be that if it is losing huge legitimate revenue to an untouchable cartel, that government should tax Nigerians to the extent of the amount being stolen by the barons.

That theory is believed to have been sold to President Goodluck Jonathan shortly after his election early last year by his Finance Minister Ngozi Okonjo-Iweala because she came directly from the International Monetary Fund (IMF), the proponent of subsidy removal from everything in the developing world.
'Defenceless masses'

The consequence of his conversion to the theory was the president's New Year gift to Nigerians in the form of the sudden withdrawal of the government subsidy and immediate doubling of the pump price of petrol across the country.

Nigerians had for long demanded information on the volume of petrol being imported, from where and by whom, but the information remained an official secret - like seemingly everything else in the operations of the Nigerian National Petroleum Corporation.

Only in December did the government raise an alarm that the subsidy on petrol price had quadrupled in the preceding 10 months without evidence of a commensurate increase in the petrol imported and distributed.

The conclusion was that a cartel was fraudulently collecting the subsidy - and billions of dollars - for petrol not imported.

Labour unions and social activists launched a campaign for government to investigate the scam and prosecute those involved. Nothing was done.

Instead, government countered with the scare campaign that the national economy was on the verge of total collapse and the only way out was to stop paying the subsidy immediately.

The popularity of President Jonathan dropped dramatically nationally, except in his home, oil-rich state.

Sadly, this is the time Nigerians need solidarity to confront the enormous security challenge posed by terrorism.

Central Bank of Nigeria governor Sanusi Lamido Sanusi replied to the popularity question at a Town Hall Meeting in Lagos by saying: "Governance is not a popularity contest."

If the government decided to do anything which it believed would be in the interest of the people despite inflicting initial hardship on them, he said, it should go ahead and do it, not minding its unpopularity.

I ask, how much more hardship can Nigerians bear when already there is no electricity, no potable water, no security, no roads, no employment, no efficient medical establishments, no good public schools and food prices are rising almost daily?

Radical lawyer Festus Keyamo said last week in a public comment that the government had finally admitted by the subsidy removal that it could not confront the individuals responsible for the corruption in the oil sector, "instead it was pouring its venom on the defenceless masses".

Last week, big rallies were staged against the subsidy removal in several cities across the country.

Although peaceful, the rallies were forcibly dispersed by armed policemen with tear gas. One person was killed.

The killing has further fuelled public anger against the president, whom they voted overwhelmingly into office nine months ago but now denounce in strong language in talk shows on independent radio and television stations in nearly all cities.

Strangely, it is the government ministers and the Central Bank governor who have been campaigning across the country for the new government policy.

President Jonathan himself has cocooned himself in State House. Two days before the strike, he defended his move in an address on national television, saying "the pain" was "in the best interest of all Nigerians".

But so far, it has not been a happy new year for the Nigerian people.